Land Bank of the Philippines vs. Emmanuel Oñate

A bank acting as trustee under an Investment Management Account with full discretion cannot rely on passbook entries alone to prove the source of funds or the regularity of withdrawals; it must maintain accurate records and render quarterly accounting, and its failure to do so makes it bear the consequences of any inaccuracies and binds it to the commissioners’ report it agreed to submit the case upon. The unwarranted withholding of trust funds is likewise tantamount to forbearance of money, subject to 12% per annum compounded annually until June 30, 2013, and 6% per annum compounded annually thereafter under BSP Circular No. 799.

Land Bank is a government financial institution created under Republic Act No. 3844. From 1978 to 1980, Oñate opened and maintained seven trust accounts with Land Bank, each covered by an Investment Management Account with Full Discretion and a corresponding passbook. Under the IMAs, Land Bank was appointed agent with full powers and discretion to hold, invest, and reinvest the funds; it was required to maintain accurate records, keep them open to inspection, and send quarterly balance sheets, portfolio analyses, statements of income and expenses, and summaries of investment changes. The IMAs also provided that the accounting would be deemed approved if Oñate failed to object in writing within thirty days from receipt.

Oñate opened and maintained seven trust accounts with Land Bank from 1978 to 1980: Trust Account No. 01-014 on September 7, 1978 with ₱250,000; No. 01-017 on November 16, 1978 with ₱1,312,896; No. 01-024 on February 23, 1979 with ₱900,000; No. 01-075 on October 8, 1979 with ₱500,000; No. 01-082 on October 25, 1979 with ₱200,001; No. 01-089 on March 18, 1980 with ₱43.98; and No. 01-125 on March 13, 1980 with ₱188,161. Each account was covered by an Investment Management Account with Full Discretion and had a corresponding passbook recording deposits and withdrawals.

In a letter dated October 8, 1981, Land Bank demanded from Oñate the return of ₱4 million it claimed had been inadvertently deposited to Trust Account No. 01-125 as his additional funds but actually represented the total amount of checks issued to Land Bank by its corporate borrowers as payment for their pre-terminated loans. Oñate refused. A meeting was held to settle the matter, but the parties failed to reach an agreement, and the issue of “miscrediting” remained unsettled. On June 21, 1991, Land Bank unilaterally applied the outstanding balance in all of Oñate’s trust accounts against his resulting indebtedness by reason of the “miscrediting.” Although it exhausted the funds in all of Oñate’s trust accounts, Land Bank was able to debit only ₱1,528,583.48.

To recoup the remaining balance, Land Bank filed a Complaint for Sum of Money seeking ₱8,222,687.89 plus interest at 12% per annum from May 15, 1992 until fully paid. Land Bank alleged that PVTA and PVTB trust funds had been invested through a direct lending scheme to RETELCO, PBM, CBY, and PHILTOFIL; that the borrowers pre-terminated their loans and paid by checks payable to Land Bank, delivered by Oñate’s representative Eduardo Polonio; that Oñate fraudulently misrepresented the checks as his additional capital contribution to his personal trust account; that the payments were credited to Trust Account No. 01-125; and that Oñate withdrew the same to Land Bank’s damage and prejudice.

Oñate denied knowledge or involvement in the PVTA and PVTB transactions and denied making any fraudulent misrepresentation. He maintained that all funds in his accounts came from legitimate sources and that he was unaware of the alleged “miscrediting.” He admitted receiving the October 8, 1981 demand letter but disputed it during a meeting with a Land Bank officer; he also refuted Land Bank’s claim that the September 3, 1991 letter was a demand letter, stating it was a response to his counsel’s request for an accounting. By way of compulsory counterclaim, Oñate alleged that per Balance Sheets as of June 30, 1982, his trust accounts totaled ₱35,555,464.78, and that as of January 1993 the accumulated balance reached ₱229,222,160.25 and $3,472,683.94. He prayed for ₱220,999,472.36 and $3,472,683.94, plus moral and exemplary damages and attorney’s fees.

Upon Oñate’s motion, the RTC created a Board of Commissioners on May 27, 1994 to examine the records of his seven trust accounts and determine deposits, withdrawals, investments, earnings, and expenses. After initially submitting three reports, the Board was ordered to reconvene and submit a consolidated report, which it filed on August 16, 2004. The consolidated report revealed undocumented and over withdrawals from the trust accounts, including total undocumented withdrawals of ₱60,663,488.11 and $3,210,222.85. On the same date, the Board filed a Manifestation that its findings on outstanding balances might not be accurate because it had not been given ample opportunity to collate and sort the documents and because there may have been double take-up of accounts. Oñate commented that the undocumented withdrawals should not be considered cash outflows but unauthorized transactions whose amounts should be credited back to his accounts. Land Bank did not file any comment or objection to the consolidated report.

During pre-trial, the parties agreed to submit the case for decision based on the Board’s reports after submitting their respective memoranda. They stipulated the issues of whether Oñate could claim on Trust Account Nos. 01-014 and 01-017, which were opened for an undisclosed principal, and whether the undocumented withdrawals and drawings were valid and regular and, if not, whether the amounts should be credited back to the accounts. The RTC found that Land Bank failed to establish that the amount of ₱4,086,888.89 allegedly miscredited to Trust Account No. 01-125 actually came from the investments of PVTA and PVTB. The Court of Appeals found that Land Bank failed to keep an accurate record and render an accounting of Oñate’s accounts and that undocumented withdrawals totaling ₱60,663,488.11 and $3,210,222.85 had been made.

• Presumption of Regularity: Land Bank argued that the entries in the passbooks must be accepted as proof of the regularity of the transactions reflected in the trust accounts, including the “miscrediting” of ₱4,086,888.89, because they were made in the regular course of business under Section 43, Rule 130 of the Rules of Court; the passbooks were always in the bank’s possession, and the entries were supported by demand letters dated October 8, 1981 and September 3, 1991 and a Statement of Account as of May 15, 1992.
• Approval Through Silence: Land Bank maintained that Oñate never questioned the statements of account and reports presented to him and was therefore deemed to have approved all of them.
• Restoration Not Pleaded: Land Bank imputed error to the lower courts in ordering the restoration of ₱1,471,416.52 because Oñate never sought that relief in his Answer.
• Undocumented Withdrawals: Land Bank argued that Oñate was not entitled to the undocumented withdrawals of ₱60,663,488.11 and $3,210,222.85; the Court of Appeals erroneously relied on the 2008 MORB, which did not exist at the time of the transactions or the filing of the Complaint; Land Bank made proper accounting and apprised Oñate of the status of his investments; Oñate’s silence constituted approval after thirty days; and Oñate could have inspected and audited the records but did not.
• Board Report Inaccuracy: Land Bank asserted that the Board’s reports did not state that the undocumented withdrawals were unauthorized and that the Board itself manifested that its report might not be accurate; the passbook entries should prevail over the Board’s reports.
• Negative Balances: Land Bank claimed that if Oñate was awarded the undocumented withdrawals based on the Board’s reports, Land Bank should also be awarded the negative balances or over withdrawals reflected in the same reports, amounting to ₱131,747,487.02 and $818,674.71.
• Indispensable Party: Land Bank argued that Oñate could not sue on Trust Account Nos. 01-014 and 01-017 without joining his undisclosed principal as an indispensable party under Section 3, Rule 3 of the Rules of Court, and that the case should be remanded following Quilatan vs. Heirs of Lorenzo Quilatan.
• Interest: Land Bank contended that trust accounts are in the nature of an express trust, not a regular deposit account involving a debtor-creditor relationship; there being no loan or forbearance of money, the applicable interest rate is 6% per annum absent stipulation, and the compounding of 12% interest was erroneous.

• Factual Issues: Oñate argued that the issues raised by Land Bank involved factual matters not proper in a petition for review on certiorari and that the Petition did not fall under any recognized exception.
• Indispensable Party: Oñate pointed out that Land Bank did not controvert his allegation that Trust Account Nos. 01-014 and 01-017 were opened for an undisclosed principal; it was too late to invoke non-joinder; and when he executed the IMAs, he acted for himself and on behalf of an undisclosed principal, so he could claim and recover amounts owing to himself and to the principal.
• Miscrediting: Oñate asserted that Land Bank failed to prove by preponderance of evidence the fact of “miscrediting”; the demand letters were not formally offered; Land Bank failed to present competent evidence of any admission of indebtedness; and since the miscrediting was not proved, Land Bank had no right to debit any amount from his accounts and must restore the funds.
• Accounting and Records: Oñate claimed that in 1982 his peso trust accounts had a total balance of ₱35,555,464.78 and his dollar trust accounts had a balance of US$1,690,943.78; he received no report or update until 1991; Land Bank failed to keep an accurate record and make proper accounting in violation of Central Bank circulars; and the undocumented withdrawals should be returned.
• Presumption of Regularity: Oñate argued that the presumption of regularity of entries in the course of business does not relieve the trustee from presenting evidence that the undocumented withdrawals were authorized; one element of Section 43, Rule 130—that the entrant be deceased or unable to testify—was lacking; and Land Bank could not excuse itself from its duty to submit accounting reports.
• Negative Balances: Oñate posited that Land Bank cannot benefit from its own negligence in mismanaging the trust accounts.
• Interest: Oñate defended the 12% per annum rate under BSP Circular No. 416 and argued that Land Bank was estopped from disputing it because Land Bank itself used 12% in its Complaint; the compounding was intended because interest income was to be capitalized and form part of the principal.

• Nature of Issues: Whether the issues raised involve questions of fact rather than questions of law and are therefore improper in a petition for review on certiorari under Rule 45.
• Presumption of Regularity: Whether the entries in the passbooks issued by Land Bank in Oñate’s trust accounts covered by an Investment Management Account with Full Discretion are sufficient to meet the presumption of regularity of entries in the course of business under Section 43, Rule 130 of the Rules of Court.
• Restoration of Debited Amount: Whether Oñate is entitled to claim ₱1,471,416.52, which was not pleaded as a counterclaim in his Answer under Section 2, Rule 9 of the Rules of Court.
• Undocumented Withdrawals: Whether Oñate is entitled to ₱60,663,488.11 and $3,210,222.85 representing undocumented withdrawals debited from his trust accounts on the ground of Land Bank’s alleged failure to meet the standards under the 2008 Manual of Regulations for Banks issued by the Bangko Sentral ng Pilipinas.
• Undisclosed Principal: Whether Oñate may sue on Trust Account Nos. 01-014 and 01-017, opened for an undisclosed principal, without joining his undisclosed principal.
• Interest: Whether the award of interest to Oñate at 12% per annum compounded yearly from June 21, 1991 until fully paid violates Article 1959 of the Civil Code.

• Nature of Issues: Factual. The issues require review of the probative value of the evidence and do not involve questions of law; Rule 45 permits only questions of law, and no exception applies.
• Presumption of Regularity: No. Passbook entries are only prima facie proof of the dates, amounts, and balances stated; they do not establish the source of funds or the validity of undocumented withdrawals, and Section 43 was not satisfied because the entrant was not shown to be dead or unable to testify.
• Restoration of Debited Amount: Yes. Because the alleged miscrediting was not proved, Land Bank had no right to debit the accounts; the restoration order was consistent with the pleadings, and Oñate had contested the setoff in his Answer.
• Undocumented Withdrawals: Yes. Land Bank failed to maintain accurate records and render quarterly accounting under the IMAs; it did not object to the Board’s consolidated report and agreed to submit the case on that report, so the report’s findings bind it.
• Undisclosed Principal: Yes. Land Bank knew the accounts were held for an undisclosed principal and itself debited them for Oñate’s personal debt; it cannot invoke non-joinder to defeat restoration.
• Interest: No. The unilateral offset and undocumented withdrawals amount to forbearance of money; 12% per annum compounded annually applies until June 30, 2013, and 6% per annum compounded annually thereafter. Commencement is May 31, 2006 for the debited amount and December 18, 2009 for the undocumented withdrawals.

• Nature of Issues: The controversy from the start involved factual questions: whether Land Bank miscredited ₱4,086,888.89 and whether the undocumented withdrawals were valid and regular. These required examination of the IMAs, passbooks, letters of instruction, withdrawal and deposit slips, statements of account, and the Board’s reports. The RTC created a Board of Commissioners, the parties agreed to submit the case based on its reports, and the Court of Appeals assessed the evidentiary records. Under Rule 45, only questions of law may be raised. Velayo-Fong vs. Spouses Velayo defines a question of law as doubt as to what the law is on a certain state of facts, while a question of fact concerns the truth or falsity of alleged facts. The MORB issue did not convert the case into a legal question because the same duties were imposed by the IMAs; even without the MORB, Land Bank failed to keep accurate records and render regular accounting.

• Presumption of Regularity: Section 43, Rule 130 requires that: (1) the person who made the entries is dead, outside the country, or unable to testify; (2) the entries were made at or near the time of the transaction; (3) the entrant was in a position to know the facts stated; (4) the entries were made in the entrant’s professional capacity or in the course of duty; and (5) the entries were made in the ordinary or regular course of business or duty. Land Bank neither identified the persons who made the passbook entries nor established that they were dead or unable to testify. Passbook entries are prima facie proof only of the dates, amounts, and balances stated; they do not show the source of funds or that withdrawals were authorized. No unbroken link was shown between the proceeds of the pre-terminated loans and the amount deposited to Trust Account No. 01-125. Land Bank could have produced documents showing the borrowers’ pre-termination, the checks they issued, and the deposit slips, but it did not. It also did not explain how Oñate or Eduardo Polonio obtained possession of checks payable to Land Bank. Under Traders Royal Bank vs. Radio Philippines Network, Inc., the bank was negligent in accepting and paying a check to a person other than the payee without valid endorsement. Only two entries were pointed to for four loans. The burden of proof by preponderance of evidence was on Land Bank. Thus, Land Bank had no right to debit the accounts, and restoration was proper. Oñate had contested the setoff in his Answer.

• Undocumented Withdrawals: Paragraph 4 of the IMAs required Land Bank to maintain accurate records of all investments, receipts, disbursements, and other transactions, and to send quarterly balance sheets, portfolio analyses, statements of income and expenses, and summaries of investment changes. Accounting was deemed approved only upon written approval or failure to object within thirty days from receipt of such accounting. Land Bank failed to comply. It kept messy and incomplete records, requiring the Board to reconcile them. The Board held 60 meetings over four years and found undocumented withdrawals. Land Bank did not file a comment or objection to the consolidated report and agreed at pre-trial to submit the case based on it. The Board’s Manifestation that its report might not be accurate due to lack of access and possible double take-up was caused by Land Bank’s custody of the records and its lack of cooperation; a party cannot benefit from its own negligence. Simex International (Manila), Inc. vs. Court of Appeals and Philippine National Bank vs. Court of Appeals support this conclusion. Oñate’s failure to inspect the records did not excuse Land Bank’s duty to send reports or authorize undocumented withdrawals. Passbooks alone were insufficient. Land Bank’s claim for negative balances was denied because Land Bank was negligent, never prayed for them in its Complaint, and did not raise them at pre-trial; Development Bank of the Philippines vs. Teston and Caltex (Philippines), Inc. vs. Court of Appeals were cited.

• Undisclosed Principal: The IMAs covering Trust Account Nos. 01-014 and 01-017 stated that Oñate signed “FOR: UNDISCLOSED PRINCIPAL.” Land Bank knew that Oñate was merely an agent and not the owner of the funds in those accounts. Yet Land Bank garnished ₱792,595.25 from those accounts to answer for Oñate’s alleged personal indebtedness and did not implead the undisclosed principal in its Complaint. It cannot now invoke non-joinder to prevent restoration. The trial court’s observation that it would be unfair to dismiss the suit after Land Bank had garnished the balances was adopted.

• Interest: The unilateral offsetting of funds without legal justification and the undocumented withdrawals are tantamount to forbearance of money. Estores vs. Supangan held that the unwarranted withholding of money rightfully pertaining to another amounts to forbearance of money, which can be considered an involuntary loan. Following Eastern Shipping Lines, Inc. vs. Court of Appeals, the applicable rate is 12% per annum. Land Bank is estopped from assailing the 12% rate because it used the same rate in its Complaint. On commencement, no demand was made prior to the Complaint; the amounts were not determined until the Board submitted its consolidated report on August 16, 2004; the RTC granted the debited amount on May 31, 2006; and the Court of Appeals granted the undocumented withdrawals on December 18, 2009. Thus, interest on the debited amount runs from May 31, 2006, and on the undocumented withdrawals from December 18, 2009. Compounding has basis in the IMA provision granting Land Bank authority to hold, invest, and reinvest the fund without distinction between principal and income. BSP Circular No. 799, effective July 1, 2013, sets the rate at 6% per annum in the absence of stipulation; hence, 12% applies until June 30, 2013, and 6% compounded annually thereafter.

• Fiduciary duty of banks under Investment Management Accounts — A bank acting as trustee or agent under an IMA with full discretion must maintain accurate records of all investments, receipts, disbursements, and transactions, and must render quarterly accounting. Failure to do so makes it bear the consequences of inaccuracies and prevents it from benefiting from its own negligence. The Court applied this to Land Bank, whose poor record keeping and non-cooperation led to the Board’s report; it could not rely on passbooks alone or claim negative balances.

• Entries in the course of business under Section 43, Rule 130 — The requisites are: (1) the entrant is dead, outside the country, or unable to testify; (2) the entries were made at or near the time of the transaction; (3) the entrant was in a position to know the facts stated; (4) the entries were made in the entrant’s professional capacity or in the course of duty; and (5) the entries were made in the ordinary or regular course of business or duty. Passbook entries are only prima facie proof of what they state; they do not prove the source of funds or authorization for withdrawals. Land Bank failed to identify the entrant or show that the entrant was dead or unable to testify, and no unbroken link to the alleged miscredited funds was established.

• Question of law vs. question of fact in Rule 45 — Only questions of law may be raised in a petition for review on certiorari. A question of law arises when there is doubt as to what the law is on a certain state of facts; a question of fact arises when the doubt concerns the truth or falsity of alleged facts. The Court applied this by refusing to review the factual findings on miscrediting and undocumented withdrawals.

• Forbearance of money and legal interest — The unwarranted withholding of money rightfully belonging to another is tantamount to forbearance of money and may be considered an involuntary loan. The Court applied this to the unilateral offset and undocumented withdrawals, imposing 12% per annum compounded annually until June 30, 2013, and 6% per annum compounded annually thereafter under BSP Circular No. 799.

• Relief must conform to pleadings and pre-trial issues — Courts cannot grant relief not prayed for in the pleadings, and issues not raised at pre-trial cannot be considered on appeal. The Court applied this to deny Land Bank’s claim for negative balances, which was not pleaded in its Complaint and was not raised at pre-trial.

• Agent for undisclosed principal and non-joinder — An agent acting in his own name for an undisclosed principal may sue or be sued without joining the principal, except when the contract involves things belonging to the principal. The Court applied this by holding that Land Bank, having dealt with Oñate as agent and debited the accounts, could not invoke non-joinder to defeat restoration.

• Contract is the law between the parties — Under Article 1159 of the Civil Code, obligations arising from contracts have the force of law between the contracting parties and must be complied with in good faith. The Court applied this to the IMAs, holding that even without the MORB, Land Bank was bound by its contractual duties to keep accurate records and render regular accounting.

• "The point is that as a business affected with public interest and because of the nature of its functions, the bank is under obligations to treat the accounts of its depositors with meticulous care, always having in mind the fiduciary nature of their relationship." — This passage, quoted from Simex International (Manila), Inc. vs. Court of Appeals, states the fiduciary standard governing Land Bank and supports the finding that it failed to maintain accurate records and render proper accounting.
• "As between parties where negligence is imputable to one and not to the other, the former must perforce bear the consequences of its neglect." — Quoted from Philippine National Bank vs. Court of Appeals, this principle was applied to prevent Land Bank from benefiting from inaccuracies in the Board’s report that were caused by its own poor record keeping and lack of cooperation.
• "A question of law arises when there is doubt as to what the law is on a certain state of facts, while there is a question of fact when the doubt arises as to the truth or falsity of the alleged facts." — Quoted from Velayo-Fong vs. Spouses Velayo, this definition supported the denial of the Petition because the issues raised required review of the probative value of evidence.
• "[the] unwarranted withholding of the money which rightfully pertains to [another] amounts to forbearance of money which can be considered as an involuntary loan." — Quoted from Estores vs. Supangan, this passage supplied the basis for imposing 12% per annum interest on the amounts Land Bank withheld from Oñate’s trust accounts.

• Velayo-Fong vs. Spouses Velayo, 539 Phil. 377, 386-387 (2006) — Defined a question of law as distinguished from a question of fact; applied to deny review of the factual issues raised by Land Bank.
• Canque vs. Court of Appeals, 365 Phil. 124, 131 (1999) — Enumerated the requisites for entries in the course of business under Section 43, Rule 130; used to reject the passbook entries as proof of the source of the alleged miscredited funds.
• Traders Royal Bank vs. Radio Philippines Network, Inc., 439 Phil. 475 (2002) — Held a bank liable for accepting and paying a check to a person other than the payee without valid endorsement; cited to show Land Bank’s negligence in handling checks payable to it.
• Simex International (Manila), Inc. vs. Court of Appeals, 262 Phil. 387, 395-396 (1990) — Elucidated the fiduciary nature of banking and the duty of banks to record every transaction accurately; relied on to hold Land Bank to a high standard of record keeping.
• Philippine National Bank vs. Court of Appeals, G.R. No. 97995, January 21, 1993, 217 SCRA 347, 358 — Held that where negligence is imputable to one party and not the other, the former must bear the consequences; applied against Land Bank.
• Development Bank of the Philippines vs. Teston, G.R. No. 174966, February 14, 2008, 545 SCRA 422, 429 — Stated that due process requires judgments to conform to the pleadings; used to deny Land Bank’s claim for negative balances.
• Caltex (Philippines), Inc. vs. Court of Appeals, G.R. No. 97753, August 10, 1992, 212 SCRA 448, 462 — Held that issues not raised at pre-trial cannot be considered on appeal; used to deny Land Bank’s claim for negative balances.
• Estores vs. Supangan, G.R. No. 175139, April 18, 2012, 670 SCRA 95, 106 — Held that unwarranted withholding of money rightfully pertaining to another amounts to forbearance of money; basis for the 12% interest award.
• Eastern Shipping Lines, Inc. vs. Court of Appeals, G.R. No. 97412, July 12, 1994, 234 SCRA 78 — Provided guidelines on the commencement and rate of legal interest; used to fix the dates from which interest runs.
• Valarao vs. Court of Appeals, 363 Phil. 495, 506 (1999) — Held that a contract is the law between the parties; cited to show that the IMAs governed Land Bank’s duties even without the MORB.
• Hyatt Elevators and Escalators Corporation vs. Cathedral Heights Building Complex Association, Inc., G.R. No. 173881, December 1, 2010, 636 SCRA 401, 412 — Stated that the party making allegations has the burden of proving them by preponderance of evidence; applied to Land Bank’s failure to prove miscrediting.
• Dycoco, Jr. vs. Equitable PCI Bank, G.R. No. 188271, August 16, 2010, 628 SCRA 346, 353 — Cautioned banks to ensure the integrity of their clients’ records; cited in support of Land Bank’s duty to maintain accurate records.
• Diona vs. Balangue, G.R. No. 173559, January 7, 2013, 688 SCRA 22, 35-36 — Reiterated that due process requires judgments to conform to the pleadings and evidence; cited in denying negative balances.
• Quilatan vs. Heirs of Lorenzo Quilatan, G.R. No. 183059, August 28, 2009, 597 SCRA 519 — Invoked by Land Bank on the effect of failure to implead an indispensable party; not applied because Land Bank itself failed to implead the undisclosed principal and had already debited the accounts.

• Section 43, Rule 130, Rules of Court — Entries in the course of business may be received as prima facie evidence if made by a person deceased or unable to testify, at or near the time of the transaction, in a professional capacity or course of duty, and in the ordinary or regular course of business. The Court found the requisites unsatisfied because Land Bank did not identify the entrant or show that the entrant was dead or unable to testify.
• Section 3, Rule 3, Rules of Court — An agent acting in his own name and for the benefit of an undisclosed principal may sue or be sued without joining the principal, except when the contract involves things belonging to the principal. The Court cited this in rejecting Land Bank’s non-joinder argument.
• Section 2, Rule 9, Rules of Court — Cited by Land Bank in arguing that Oñate could not claim the debited amount because it was not pleaded as a counterclaim. The Court found the restoration order consistent with the pleadings and Oñate’s contest of the setoff.
• Article 1159, Civil Code — Obligations arising from contracts have the force of law between the contracting parties and should be complied with in good faith. The Court applied this to the IMAs, which governed Land Bank’s duties independently of the MORB.
• Article 1169, Civil Code — Demand is required before delay may be incurred; the Court cited this in discussing when legal interest should commence, following Eastern Shipping Lines.
• Article 1959, Civil Code — Cited by Land Bank in questioning the 12% interest rate. The Court found the 12% rate proper until June 30, 2013, after which 6% per annum applied under BSP Circular No. 799.
• BSP Circular No. 799, Series of 2013 / Monetary Board Resolution No. 796 — Effective July 1, 2013, the rate of interest in the absence of express stipulation is 6% per annum. The Court applied this to reduce the interest rate on all amounts awarded beginning July 1, 2013.
• Sections X401 and X425, BSP Manual of Regulation for Banks — The Court of Appeals relied on these provisions on disclosure and transparency. The Court held that the same duties were also imposed by the IMAs, so the case could be resolved without relying on the MORB.
• Republic Act No. 3844 — The law creating Land Bank as a government financial institution, cited in the factual antecedents.
• Section 4, Rule 3, Internal Rules of the Supreme Court — Enumerates exceptions to the rule that only questions of law may be raised in a petition for review. The Court found no exception applicable.

Antonio T. Carpio (Chairperson), Arturo D. Brion, Jose Portugal Perez, and Estela M. Perlas-Bernabe concurred. No separate concurring opinions are summarized in the text.